That’s a 46% increase in the number of active women business operators in the last two decades alone, compared to a 27% rise for men.
A solid foundation for game changing shifts in the way modern finance is being proactively restructured and tailored for a more inclusive offering going forward.
This is a global upward trend that isn’t necessarily unique to Australia but does have a very specific impact on the categories within this community that are singular to Australia.
These include Aboriginal or Torres Strait Islander women who make up just under 2,890 business operators, 0.6% of women business operators, and 0.2% of all Australian business operators.
Migrant women who were born overseas and represent 30% of Australian women business operators.
Women with disabilities who represent 12% of women employers and sole operators, just under 2% of whom are profoundly limited in their core activities.
Women in remote Australia, around 2.3% of whom operate businesses from remote Australia while 31% are in regional Australia.
Older women, 28% of whom are business owners aged 55 years and over.
And women with dependent children who make up a significant 47% of all women business operators - in fact women who operated businesses were the most likely employed people to have dependent children.
The often questioned myth about business ownership and modern day entrepreneurship is that it comes with the freedom to choose when to work, and the flexibility to fit that work around life and family.
A blend rather than a balancing act. And possibly the real appeal for women as they strive to carve out a role, a purpose, and an identity - as well as income.
This snapshot of the Australian small business landscape, specifically from the perspective of women in business, gives a rarely seen insight into potential niche areas in finance where women’s requirements might be met more comprehensively.
With female COO Anna Hawter at the helm, tech enabled lender Lumi is perfectly poised to lead by example when it comes to empowering female entrepreneurs. Positioned at the intersection of innovation and inclusivity Lumi is literally flipping the traditional finance model on its head by championing female business owners through targeted funding providing market leading unsecured small business loans and business line of credit products.
Supporting not-for-profits who make a point of backing female entrepreneurs has also secured their position as a primary change maker when it comes to making moves across the board in one of the fastest growing sectors of small business finance.
A recent Lumi partnership with female owned The Goodnight Co. highlighted the potential for success when women in business are supported in staying on track with their business goals. This is particularly relevant as the world emerges from COVID-19 and an unprecedented level of uncertainty for all small business owners but in particular for women in the workforce who have been hit harder than most by the repercussions of lockdowns.
As the company performed the ultimate pivot to online sales, cashflow was critical as they sought to efficiently maintain stock, in alignment with shifting customer demand. With finance from Lumi they received the short term cash boost they needed to keep the business thriving; a prime example of what it’s possible to achieve when you’re seen, heard and accommodated by your chosen lender.
With female-owned businesses generating an increasing amount of money each year, and providing a sustainable income for so many within Australia, it’s unfortunate that they’re still often less likely to be approved for a business loan than their male counterparts.
The remedy begins at the application and criteria stages of the loan application process and it’s doing the research here that will make the biggest impact on success rates for women in business.
Making the loan application process easily accessible is key. This begins with transparency from the start and can be as simple as up front calculations of loan repayments with no hidden extras.
Taking the jargon and guesswork out of finance also removes the anxiety that potentially comes with the application process.
A loan application process that’s smart and innovative is a signature calling card for women business owners. Replacing paper forms with a smooth, swift online alternative also saves small business owners vast amounts of time. And time is money.
Sophisticated new tech that connects cloud software with accounting applications takes the time consuming element out of applying for small business loans and allows small business owners to better allocate their time when it’s already in short supply.
For women who, according to the stats above, are typically managing households as well as their hustle, this level of efficiency is typically non negotiable. It’s not a nice to have, it’s a prerequisite for getting the best possible value from a business loan, from start to finish.
In terms of the typical set up for female entrepreneurs - such as the fact that they could be juggling paid work as well as the fledgling business, and potentially family commitments too, the different levels of flexibility lenders can offer are also a game changer.
The opportunity to secure ample finance with a simple application process, no collateral needed, with the possibility of receiving those funds on the same business day is a level of flexibility that allows business owners to take a breath and focus their energies where it counts.
This allows women in particular to jump the queue instead of jumping through hoops, all while juggling the business and non business related responsibilities piled high on their proverbial plates.
It also relieves them of the pressure of putting the family home or other valuable assets up as a guarantee. A level of risk that might otherwise discount them from the process completely. A great insight into the amount of space a little flexibility allows women to take up in the broader small business conversation.
In terms of boosting cash flow, if the business in question is seasonal and experiencing slow months this allows for the possibility of staying afloat rather than being pulled under by the weight of single handedly carrying a small business and the commitments that come with it.
If the business is thriving thanks to the clever marketing and viral social media campaigns women in business tend to rely heavily on, flexible finance allows them to take up opportunities that might otherwise pass them by.
This is particularly true of short term finance structures where funds can be approved for smaller amounts of time meaning less overall time in debt and commuted to making repayments.
In addition the typical waiving of early repayment fees makes good financial sense for female entrepreneurs as they look to funnel valuable funds back to their businesses. It’s a simple but effective reward for hard work and hustle that again opens up more windows of opportunity for women looking to lock in the best possible loan terms.
With female owned businesses expanding at a rate of knots it’s also important to note that each one is targeting a very specific audience or industry sector. Each one is aligned with very specific strategies and their own individual goals. There is no one size fits all.
Their requirements therefore are centered around a lender’s ability to adapt and accommodate. They need to be listed to, and then catered to, with a raft of services that suit their need for support that evolves as the business does. And finance that fills the gap and hits the spot when they need it most.
2020 showed small business owners that they really have no guarantee as to what’s happening next day to day let alone month to month and certainly not year to year at this point.
Business loans that allow for quick pay off and/or more frequent micro payments set a precedent for business women that allows them to take creative risks with their businesses without putting their homes and livelihoods at risk. Or their sanity. Advantages like flexible terms, shorter loan length, and zero collateral requirements in their corner open up the possibility of taking a seat at a table typically dominated by men and make oriented businesses.
Seen through the lens of women entrepreneurs this equates to better representation and a vital part of an equality movement much bigger than just finance. It’s important work that needs to be refined and revisited until the amount of financial support available to women is equal to the amount of groundbreaking innovation - and hard cash - their burgeoning businesses are bringing in.
When it comes to small business finance solutions for Australian women, service, support and pricing are everything.
For their part women in business are increasingly savvy about how to line up finance that best serves their needs. From scoping out lenders with flexible policies to calculating repayments as part of their research into which options provide the best return. The goal is to secure a loan that’s designed to fit snugly with their personal business needs as they prepare to take their business to the next level.